Displaying items by tag: property negotiation

Market Wrap

It is still a very strong property market in the Northern Rivers - especially the postcodes 2479 to 2483. I see no let up on the strong demand that we were experiencing in the last two quarters of last year. Supply may increase a bit as more people decide to list to take advantage of the current high prices. But many are deterred from that unless they are moving from the area, as they will still have to buy into a high market.

Sydney’s median house price rose 4.7% during the quarter to December. The Sydney median is now at $1,123,991 while Byron Bay is at $1,208,950. There is a reasonable assessment around that we have plateaued and there should be some easing off, but at present, I and no one else I am dealing with, is experiencing that. The above graph shows the recent spike in price growth over the last two years.

If interest rates remain low and the current policy settings stay in place, the market should stay strong for the foreseeable future. The three major property research firms are predicting 11% annual rise for Melbourne and 16.7% rise for Sydney during 2017. The NAB bank have increased their national price growth expectation to 3.4% and have halved the expected capital city apartment price drop from 1.6% to 0.8%. Their report also stated that a price drop would be imminent only if there was a rapid increase in unemployment or interest rates. Even respected ABC TV commentator Alan Kohler confirmed the present market is sound and a long way from a bubble.

Byron area is usually 12 -18 months behind the Sydney trend. If this remains true, even if Sydney and Melbourne come off the boil this year, we will still have some time to cook. The main demographic fuelling the local market is baby boomer retirement to lifestyle locations like Byron Bay. Currently, I see no let up to demand with associated price rises all through 2017.

Engaging a buyer’s agent is highly advisable in a strong market. Entering this market requires certainty and decisiveness. By the time many buyers have missed out, been gazumped or outbid at auctions, they can get rattled and are likely to make rash, ill-conceived decisions. Recognising good value and potential only comes with long experience and deep local knowledge. Getting the ear of local agents and being told the truth also helps. Knowing how to get to the pointy end of a negotiation and keep a property away from a competitor is a good skill to have in these times.

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What's the BPS secret?

How can Byron Property Search save you time, money and lots of hassle?

I get frustrated property buyers calling me all the time, just when they are about to give up the search. It looks easy at first. They know their way around the Internet and they have purchased a property before. They think it would be stupid to hand over such an important investment decision to someone else. How hard can it be?

When they finally get around to calling me they say:

The agents never call me back

I have inspected so many dud properties

I can’t find time to inspect and do proper due diligence

It's hard to know what is a fair market value

I missed out at an auction and can’t go thru that again

I don’t know who to believe in a negotiation

Well, stop doing it to yourself:

  • BPS can fix these problems before you get started down the road to frustration:

We have excellent relationships with all the major agencies, who know we have qualified buyers that will not waste their time.

Our deep local knowledge saves time and we know how to detect any hidden issues

The “video with commentary” inspection is as good as doing it yourself

Our market estimates are backed-up with quality research and data

Years of attending auctions has given us an edge

In a strong market we get you ahead of the pack. In a weak market we get a good deal. There are tricks and strategies to help not being outbid.

We negotiate using our existing relationships. Nothing is hidden and everything is transparent

Our offer is:

If not completely satisfied with the service after the first 30 days we will refund the engagement fee - in full. We will save you the time and money with no need to get to the stressful part. We will get you to the pointy end of the search as soon as we take your brief. We know what is good value and what will work for you – immediately, guaranteed.

Don’t believe me? Why not talk to a few of previous clients who were in your exact position:

We were looking for months and were afraid we missed the market. Michael came on board and we got the right place with a couple of weeks.

Rick, Ocean Shores

Michael attended our auction and it was uncanny. What he said was going to happen turned out to be exactly right and we got it at the price he said it would go for.

Lisa, Byron Bay

What we thought we wanted was very different from what we finally got. And that was a good thing. Michael was able to refine our search so that what we got was perfect and what we thought we wanted would have been a mistake.

John, Coorabel

The next step:

Provide us with an outline or wish list and a budget. We will start sending you links, inspecting properties on your behalf, providing property reports and CMAs (Comparative Market Analysis) and fair market valuations immediately. Most of our clients are settled and happy within three months. If you are not happy with the service provided you can ask for your engagement fee back and you have lost nothing.

Avoid getting angry annoyed, upset, frustrated and stressed.

Call us before you get to that state and we will do the rest. We will all enjoy the process a lot more.

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Be a better negotiator: 5 simple tips

When I first started as a property buyer’s agent over 15 years ago, I thought I would have to learn how to be a tough negotiator. I imagined I would be standing up to those pushy agents and getting a great deal for my clients. How wrong was I and I think its interesting what I've learnt over the years. 

I was provoked into thinking about this with all the 24/7 news about Donald Trump. I realised there are two different ways to do a negotiation: “adversarial” or “relational”. Dear Mr Trump is obviously an adversarial negotiator. These days, that style and behaviour is probably outmoded, out-dated and basically dysfunctional.

Personally, I have found that the best deals and best outcomes always happen after building a strong relationship with whomever I am dealing with. As a buyer’s agent, my focus is to uncover all the relevant facts first and then use that information transparently so everyone is on the same page. Build a relationship that is open and transparent with the idea of attaining the best outcome for all involved.

These are the things I have learnt:

1. Don’t make it all about the money

I always hear people say don’t give anything away while inspecting a property. “Keep it tight to your chest” is often the advice. Yes, don't expose your spending power right from the start but you should say clearly what you want and what works for you. Find out about the property, its owners and reason for selling. Remember the four Ds behind property sales - death, divorce, debt and downsizing. Whats the D behind this sale. Build a relationship with the agent and the vendors as much as possible. Agents are people too and not your enemy. 

2. Don’t make ridiculous bids

I sometimes get clients asking me to make an offer way below the listing price. I ask them to put themselves in the seller’s position. People can be very sensitive and emotional about there own homes. Often they have put a lot of their own heart and soul into it. They are also very emotional about money. The worst thing to building a good relationship is making a low-ball, gambit bid and insult the owner.

3. What else will help make the deal happen?

Once you find out a lot of about the property and situation, sometimes there are other matters beside the price that can be important. Do the sellers want a longer or quick settlement? Is the furniture included? Are there issues around a pest or building report? Waive the cooling off period? Is the finance firmly in place? Perhaps the vendor needs some time to rent back the property for a time while looking for a new place. Factoring in some of these variables can assist in the sale and help get that contract signed.

4. Do the work for the agent

Although its good to be transparent and develop good relationships, there is nothing wrong with exploiting a major weakness within the real estate industry. Agents are working for the seller, but in essence, are getting paid by the buyer. This is an inbuilt conflict of interest and there is nothing wrong with enlisting the agent onto your team to facilitate the sale. Agents are often busy and stressed, if you can make the deal as easy and stress-free as possible you are a long way to getting the deal done. There are many strategies to do this but mainly making the offer as uncomplicated and free of conditions as possible helps a lot.

5. Be decisive

Either be prepared to walk away or go early, go hard! Don’t be indecisive or wishy-washy. Be prepared to hold the tension and know your limit. It is good to have another option so you are not fixated on one property. But if you know this is the one and you want it, don’t hesitate, make a bid, meet the price and get it done. I have seen many deals go south because of pride, ego, small amounts of money or playing stupid games or tactics.

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Hilarious take on the modern auction

If you’re walking down a suburban street on a weekend, you may spot a large group of people standing outside a property, with another person standing in front of them yelling out stuff – in which case, you’ve probably stumbled across a domestic hostage situation, there are terrified homeowners trapped inside, and the yelly person is a deranged maniac, possibly armed. But if the deranged yelly maniac is wearing a nice suit or quality blazer, then there’s a chance that this is actually a property auction, which is not dissimilar to a hostage situation in the sense that it goes on for way too long and there are also terrified homeowners trapped inside.

The first person you notice at any auction is The Auctioneer: they’re the ones in the $2000 outfit, with the $4000 watch, and the $6000 white-glo laser-bleached smile. Auctioneers are loud, confident people who love performing: at school they played Snoopy in a production of You’re A Good Man, Charlie Brown; in their early 20s they sung in a Hall & Oates cover band; but deep down they were always attracted to a life in real estate – but the showbizzy side.

Beside them, slightly to the back, you will spot the Auctioneer’s Assistant: for now they’re just a quiet, low-key person in a white shirt holding a clipboard, but one day they dream of growing up into a showman in a suit swinging a rolled-up piece of paper.

Now we turn our attention to the large group of people. About 2 per cent of them are committed bidders, 5 per cent are possible bidders, and 93 per cent are sticky-beak neighbours who want to know what local property values are worth, thinking to themselves, “Wow, if this property is worth THAT, then my property must be worth the same! If I wasn’t renting, I’d be soooo rich!”

Standing at the front of the group are The Super Keen Yet Hilariously Naive First-Home-Buyer Couple. They bid with great enthusiasm, they go right to their financial limit, they think they’ve bought the place with their final desperate bid … then The Auctioneer heads off to “refer the bid to the vendor”, reappears five minutes later, and the proper auction begins. You will not hear from this couple again.

Right in the middle of the group is The Mildly Confident Middle-Aged Amateur Bidder: they think they know what they’re doing, they’re showing tremendous swagger and pizzazz, and they’re completely unaware that they’ve been bidding against themselves for the past two minutes.

Down the back is The Repugnant Cashed-Up Buying Profesh, biding their time, waiting to strike with a killer bid – you can always recognise them by their unique guttural squawk, “Is it on the market? Is it on the market?”. Lurking to one side is The Mysterious Nonchalant Phone Bidder: they have no fear, they do not care, it’s not their money – for this reason, they are shunned by the other bidders and forced to stand in the neighbour’s unmown nature strip where the dog turds hide.

Also making an appearance at the most tense and dramatic moment of every auction, Dopey Slow-Moving Car-Peeper will drive past, completely disrupting the momentum, and knocking a good five grand off the property. And if you’re very, very patient, if you’re very, very lucky, you may catch a quick glimpse of The Terrified Homeowners themselves, peeking out from behind a curtain, faces pale with anxiety, eyes bloodshot with stress, mumbling their haunting, plaintive chant: “One more bid … c’mon … just one more …”

 

 
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